JOHANNESBURG, June 18 (Reuters) – South African insurance giant Sanlam has announced its acquisition of a 60% stake in MultiChoice’s insurance division for an upfront cash payment of 1.2 billion rand ($66 million). The agreement also includes a performance-based earn-out of up to 1.5 billion rand, contingent on the insurance business’s gross written premium by the end of 2026, the companies revealed on Tuesday.
MultiChoice, Africa’s leading pay-TV operator, acknowledged that while its insurance sector has shown significant growth within South Africa, scaling its operations domestically and across the continent necessitates additional resources, expertise, and technology.
“Sanlam’s extensive presence and expertise across Africa, along with its successful track record in insurance ventures with non-insurers, makes it a strategic partner for MultiChoice,” both companies stated in a joint announcement.
The agreement also stipulates a pre-acquisition dividend of 59 million rand to be declared by MultiChoice’s insurance business. As of 0747 GMT, Sanlam’s shares had risen nearly 5%, whereas MultiChoice’s shares saw a slight increase of 0.36%.
MultiChoice will retain a 40% stake in both its insurance business and the broader commercial collaboration with Sanlam. This partnership allows Sanlam to further extend its insurance and financial services footprint across Africa, facilitated through its SanlamAllianz business for opportunities outside South Africa.
MultiChoice boasts a subscriber base of 21 million households spanning 50 African countries, while Sanlam operates in 31 countries, including eight of the ten largest economies on the continent.
The current exchange rate is 1 US dollar to 18.2801 rand.
